An outgoing DWP minister just revealed the millions it pays out to a notorious company

An outgoing Department for Work and Pensions (DWP) minister just revealed the extent to which a notorious private outsourcing firm has its claws in the welfare state. It’s to the tune of over £150m.

The DWP: outsourcing heaven

On 5 July, Labour MP David Drew asked the DWP’s secretary of state Esther McVey:

how many current contracts her Department has with Serco; and what the (a) value, (b) start date and (c) end date of each of those contracts is.

The DWP outsources many parts of its operations; not least the controversial Work Capability Assessments. These are run by companies like Maximus, with others like Capita running assessments for Personal Independence Payments (PIP).

But as former parliamentary under-secretary at the DWP Kit Malthouse revealed, outsourcing giant Serco also has its fingers in the department’s pie. His answer to Drew’s question showed that the DWP is paying out over £150m to Serco for various contracts:

The largest ones are for Serco to deliver the Work Programme in two Contract Package Areas (CPAs): South Yorkshire (CPA17) and parts of the West Midlands (CPA15). It’s a service to support people into work, with Serco being ‘paid by results’. But if its performance elsewhere is anything to go by, the government ‘paying it by results’ shouldn’t (in theory) work out well.

A problematic history

Serco has a problematic reputation. As The Canary previously reported, it has public sector contracts in countless areas of everyday life, from refuse collections to parking enforcement. Serco is probably best known for running the notorious Yarl’s Wood immigration detention centre, where one woman died and others went on hunger strike due to the appalling conditions.

Also, as The Canary‘s Frea Lockley noted, Serco was investigated by the Serious Fraud Office for overcharging the government for the electronic tagging of offenders. The government accused Serco of tagging prisoners who were dead, abroad, or still in prison.

More recently, Serco was named in the ‘Paradise Papers’ tax avoidance scandal. It was also involved in the controversy surrounding 450,000 women not receiving scans for breast cancer.

A match made in heaven

Social media was expressing its frustration and anger at Serco’s relationship with the DWP long before Malthouse’s statement – going back as far as 2012:

Be afraid, be very afraid. Serco have been hired by the DWP to target those on sickness benefit… http://t.co/tVueT6sq

— Tory Fibs (@ToryFibs) April 3, 2012

Is this the last straw? I have to contact Serco to discuss my DWP mortgage payments, which will now be a loan. @Gian_TCatt pic.twitter.com/P4YjQhduP1

— Mr Ethical (@nw_nicholas) January 23, 2018

https://twitter.com/BENEFITS_NEWS/status/970613272813727745

Unfortunately for Serco, the DWP is currently phasing the Work Programme out; replacing it with the Work and Health Programme. It didn’t give Serco a contract for this.

If you want an example of one of the most controversial government departments working hand in hand with one of the most controversial outsourcers – look no further than the DWP and Serco. A match made in heaven?

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Featured image via UK government – Wikimedia and Serco Group plc – Wikimedia